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How Medicaid WorksA Chartbook for Understanding Virginia’s Medicaid Insurance
and the Opportunity to Improve it
The Commonwealth Institute
Virginia Poverty Law Center
December 1, 2017
SECTION I Understanding Virginia’s Medicaid Program Today 1
SECTION II Virginia’s Opportunity to Expand Medicaid 7
Cover photo: Catherine Scott
SECTION I
Understanding Virginia’s Medicaid Program Today
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The Commonwealth Institute
• Medicaidisapublichealthinsuranceprogramforlow-incomepeople.Itwasstartedin1965.Medicaidinsurancecoversmostlychildren,pregnantwomen,parents,seniorsoverage65,andpeoplewithdisabilities.
• InVirginia,nearly1millionpeoplehavehealthcoveragethroughMedicaidatanytime.
• Medicaidisjointlyfundedthroughfederalandstatedollarsandadministeredbythestate.EverydollarVirginiaspendsinMedicaidismatchedbyadollarinfederalfunds.
• Sevenoutoftenoffice-baseddoctorsinVirginiaareacceptingnewMedicaidpatients.
SECTION I: Understanding Virginia’s Medicaid Program Today
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• Medicaid’simportantroleandeffective-nessleadtobroadpublicsupportformaintainingit.
• Eighty-fourpercentofthepublicopposescutstoMedicaid.
SECTION I: Understanding Virginia’s Medicaid Program Today
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Eligibilitylevelsdeterminewhocanreceivecoverage.Statesseteligibilitylevelsbasedonpersonalincomeandassets.Eligibilitylevelsforchildren,parents,andpregnantwomenincludea5percentincomedisregard.
VirginiahasveryrestrictiveMedicaideligibility:
• Pregnantwomenandchildrenthroughage18cannothaveincomehigherthan148percentoffederalpovertylevel(FPL)or$30,240forafamilyofthree.(Virginia’sFAMISprogramcoverschildrenandpregnantwomenupto205percentFPLor$41,880forafamilyofthree.)
• Elderlyanddisabledpeople(unlessonaspenddownorinlongtermcare)cannothaveincomehigherthan80percentFPLor$12,992foranelderlycouple.
• Workingparentsmusthaveincomebelow52percentFPLor$10,524forafamilyofthree.(Seenextpageforincomelevelsbygeographicregion.)
• ChildlessadultsarenoteligibleforMedicaidinVirginia.
SECTION I: Understanding Virginia’s Medicaid Program Today
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The Commonwealth Institute
• Forworkingparents,maintainingeligibilityisahighwireact.Becausethemaximumallowableincomeissolowandvariesbylocality,workingparentscanenduplosingtheireligibility—thoughnotimmediately—withjustalittleovertimeorevenapromotionthatcomeswithaslightlyhighersalary.Or,iftheyhavetomovetoanotherlocality,theymaysuddenlyfindtheyhavelosttheireligibility
SECTION I: Understanding Virginia’s Medicaid Program Today
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• Becausehealthcarecostshavebeenrisingacrosstheeconomyformanyyears,Medicaidcostshavebeenrising,too.Whencomparedtothestatebudget,whichshrunkduringtherecession,itcanlooklikeMedicaidcostsarerisingrapidly.
• Farfrombroken,Medicaidisactuallyveryefficient.Medicaidhasloweradministrativecoststhanprivateinsurance,andtherateofgrowthhasbeenmuchslowerthanprivateinsurance.
SECTION I: Understanding Virginia’s Medicaid Program Today
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SECTION II
Virginia’s Opportunity to Expand Medicaid
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The Commonwealth Institute
SECTION II: Virginia’s Opportunity to Expand Medicaid
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The Commonwealth Institute
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The Commonwealth Institute
Health Care for Low-Income Adults• Virginia lawmakers could close the coverage gap
by taking the option offered to states to increase Medicaid eligibility for most adults to 138 percent of the federal poverty level (FPL). This is equal to an annual income of $16,643 for an individual and $28,180 for parents in a family of three in 2017.
• This expanded eligibility would primarily help parents and other working adults who are not offered coverage through their jobs and cannot afford other coverage. As of October 2017, Washington D.C. and 31 states, including Kentucky, West Virginia, and Maryland have expanded, and the opportunity remains today. Virginia’s share of expansion cost is limited to 10 percent.
Health Care for Workers in Key Sectors• The majority of people who would be newly eligible
for coverage are working. And they are working in the most important sectors of our economy. Workers in five of the state’s largest employment sectors have the most to gain: Accommodation and Food Services; Retail Trade; Education, Health, and Social Services; Construction; and Professional and Business Services.
Health Care for Veterans• If Virginia expanded Medicaid and closed the
coverage gap, Virginia’s military veterans would also benefit. 12,600 military veterans in Virginia could get quality, affordable health care coverage. An estimated, 5,300 Virginia veterans are uninsured, while another 7,300 are underinsured.
Health Care for Communities of Color• 66 percent of the nonelderly population with
Medicaid coverage in Virginia are people of color. Over forty percent of the adults left uninsured because of Virginia’s refusal to expand Medicaid are also people of color.
SECTION II: Virginia’s Opportunity to Expand Medicaid
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IfVirginiacontinuestorefusefederaldollarsforMedicaidexpansionin2019and2020, thestatewouldbe:
• Unabletosave$5.7millionpermonthinstategeneralfunddollarswhicharenowusedforstate-fundedhealthprograms;
• Losingoutonatotalnetstate-savingsof$138millioningeneralfundsduringfiscalyears2019and2020;
• Forfeiting$3.4billioninfederaldollarsbytheendofthebiennium.Thatmoneycanbeusedtohelphundredsofthousandsoflow-incomeVirginiansgetthehealthcaretheyneed;
• Foregoingsupportfor15,000jobsinhealthcareandVirginia’soveralleconomythatwouldgenerate$74millionperyearinnewstateandlocaltaxrevenues;and
• Ignoringthebestwaytodirectlyaddressmentalhealthneedsandtheopioidcrisisthroughdirectservicesandtreatmentsforuninsuredadults.
SECTION II: Virginia’s Opportunity to Expand Medicaid
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The Commonwealth Institute
Health Insurance MattersThe debate surrounding the expansion of Virginia’s Medicaid insurance program has focused on costs, but has ignored an equally important issue: the value of health insurance. Three recent studies show just what kind of value health care coverage delivers for individuals and communities.
CONTROLS COSTS
REDUCES DEATH RATE
IMPROVES FINANCIAL
HEALTH
48.3% 4.5%
235 1st year
fewer deaths in Virginia by 2018
decrease in average health care costs per year
reduction in potentially preventable deaths
Results compare people without health insurance who gained coverage through a VCU program for 1 year versus 3 years. Those insured for 3 years had fewer emergency room and more regular doctor visits.
Results compare people with gained coverage in Oregon versus those who didn’t.who are uninsured.
Results compare the reduction in mortality when people in Massachusetts gained coverage with similar localities in other states where people didn’t gain coverage.
80%less likely to have catastrophic medical expenses
50%less likely to borrow money or fail to pay other bills because of medical debt
3rd year
Sources: The New England Journal of Medicine, Health Affairs, Annals of Internal Medicine
$8,900
$4,600
Results compare people who gained coverage in Oregon versus those who remained uninsured.
SECTION II: Virginia’s Opportunity to Expand Medicaid
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The Commonwealth Institute
For more information, contact:
Kenneth GilliamPolicy AssociateThe Commonwealth Institute for Fiscal [email protected] x108
Jill A. HankenHealth AttorneyVirginia Poverty Law [email protected]
The Commonwealth Institute
The Commonwealth InstituteTheCommonwealthInstituteforFiscalAnalysisprovidescredible,independent,andaccessibleinformationandanalysesofstatepublicpolicieswithparticularattentiontotheimpactsonlow-andmoderate-incomepersons.Ourproductsinformstateeconomic,fiscal,andbudgetpolicydebatesandcontributetosounddecisionsthatimprovethewell-beingofindividuals,communitiesandVirginiaasawhole.
The Virginina Poverty Law CenterTheVirginiaPovertyLawCenterisanon-profitorganizationthatservesVirginia’slegalaidsystembyprovidingadvocacy,training,andlitigationsupportonciviljusticeissuesthataffectlow-incomeVirginians.
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